Financial Instruments

Cash, Cash Equivalents and Marketable Securities

The following tables summarize our cash and available-for-sale securities by significant investment category as of June 29, 2012 and December 31, 2011.



	June 29, 2012
(In thousands)	Cost		Unrealized Gains		Unrealized Losses			Fair Value		Cash and Cash Equivalents		Short-Term Marketable Securities		Long-Term Marketable Securities

Cash	$	97,497	$	—	$	—		$	97,497	$	97,497	$	—	$	—

Available for sale:
Level 1:
Money market funds	2,734,389		—		—			2,734,389		2,734,389		—		—
U.S. treasury securities	545,365		2,770		—			548,135		27,182		12,774		508,179
Subtotal	3,279,754		2,770		—			3,282,524		2,761,571		12,774		508,179

Level 2:
U.S. agency securities	42,433		14		(3		)	42,444		24,995		5,056		12,393
Non-U.S. government securities	10,293		5		(4		)	10,294		—		7,787		2,507
Municipal bond	753		1		—			754		—		754		—
Corporate securities	76,648		232		(25		)	76,855		—		20,010		56,845
Subtotal	130,127		252		(32		)	130,347		24,995		33,607		71,745
Total	$	3,507,378	$	3,022	$	(32	)	$	3,510,368	$	2,884,063	$	46,381	$	579,924



	December 31, 2011
(In thousands)	Cost		Unrealized Gains		Unrealized Losses			Fair Value		Cash and Cash Equivalents		Short-Term Marketable Securities			Long-Term Marketable Securities

Cash	$	165,122	$	—	$	—		$	165,122	$	165,122	$	—		$	—

Available for sale:
Level 1:
Money market funds	3,189,462		—		—			3,189,462		3,189,462		—			—
U.S. treasury securities	6,199		—		—			6,199		—		6,199			—
Corporate securities	12,999		—		—			12,999		10,999		2,000			—
Subtotal	3,208,660		—		—			3,208,660		3,200,461		8,199		—	—

Level 2:
U.S. agency securities	41,167		11		(7		)	41,171		750		25,890			14,531
Non-U.S. government securities	8,221		—		(8		)	8,213		—		8,213			—
Municipal bond	754		—		(1		)	753		—		—			753
Corporate securities	87,415		84		(230		)	87,269		5,600		22,920			58,749
Subtotal	137,557		95		(246		)	137,406		6,350		57,023			74,033
Total	$	3,511,339	$	95	$	(246	)	$	3,511,188	$	3,371,933	$	65,222		$	74,033

The adjusted cost and estimated fair value of marketable debt securities (corporate bonds, municipal bonds, U.S. and foreign government securities, and U.S. treasury securities) as of June 29, 2012, by contractual maturity, are shown below. Actual maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations without call or prepayment penalties.



	June 29, 2012
(In thousands)	Cost		Estimated Fair Value
Due in one year or less	$	98,544	$	98,558
Due after one year through five years	576,948		579,924
	$	675,492	$	678,482

Derivative Financial Instruments

We use derivative financial instruments primarily to manage foreign currency exchange rate risk. Substantially all of our operational expenditures are transacted in U.S. dollars. However, operating expenditures of our subsidiaries are incurred in or exposed to other currencies, primarily the Malaysian Ringgit. We hedge portions of the forecasted foreign currency exposure associated with operational expenditures in Malaysia generally up to three months in advance. We record all derivatives at fair value. These forward foreign currency exchange contracts were designated and qualified as cash flow hedges and the effective portion of the gain or loss on the forward contracts was reported as a component of other comprehensive income and reclassified into net income in the same period during which the hedged transaction affected earnings.

The notional amount of our outstanding foreign exchange contracts was $9.3 million as of June 29, 2012. The outstanding forward currency exchange contracts expire at various dates between July 2012 and September 2012. We did not have any hedging activities as of December 31, 2011.